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Bangladesh Bank Governor Dr Ahsan H Mansur on Monday recommended creating a separate secondary market for savings certificates to make them fully tradable, saying that such a move would benefit investors, enhance liquidity and help deepen the country’s financial market.
“Right now, savings instruments are only partially linked to the market. We need to make them fully tradable. If there is political will, this can be done,” he said.
The central bank governor was addressing a seminar, titled ‘Unlocking Bangladesh’s Bond & Sukuk Markets: Fiscal Space, Infrastructure Delivery and Islamic Money Market Development’, was jointly organised by Bangladesh Securities and Exchange Commission & Dhaka Stock Exchange PLC.
The governor also called for a dedicated market for private bonds alongside government securities.
“Ordinary citizens are already able to invest in government bonds, which are a positive step. Now, private bonds must also be made tradable under the right structure. That alone could double the bond market overnight and make it vibrant,” he said.
Highlighting long-term funding opportunities, Mansur said pension schemes, provident funds, corporate pension funds, and benevolent funds could be major sources for bond investment. “For this, a pension regulatory authority is essential to ensure that institutions are building their funds properly,” he added.
The governor pointed out Bangladesh’s financial structure is inverted compared to the global economy. “Globally, the bond market dominates with about USD 130 trillion in outstanding bonds—equivalent to 130% of global GDP.”
Stock markets account for USD 90 trillion, while the money market is about USD 60 trillion. But in Bangladesh, we are overly bank-dependent, and our insurance sector is only 0.4% of GDP—too small to count,” he said.
He observed that corporate entities in Bangladesh rely heavily on banks instead of issuing bonds.
“Perhaps there are incentives behind this—like opportunities to avoid repayment or exercise political influence. But we must move away from this bank-dependent corporate culture,” Mansur said.
On Islamic finance, he noted that the sukuk market remains very small, with only six sukuk worth Tk 24,000 crore issued so far.
“Yet, many of our infrastructure projects generate revenue streams that can be securitised. Toll flows from the Padma or Jamuna bridges, metro rail, flyovers, or highways could be securitised to fund new projects. For this, the finance ministry needs a specialised unit dedicated to such innovations,” he suggested.
Mansur also underlined the need for expanding the insurance sector, saying coverage in Bangladesh stands at just 0.4% of GDP compared to 4% in India and 12% in advanced economies.
The governor concluded by revealing that Bangladesh Bank has already prepared a research-based policy paper with specific recommendations for bond market reforms, covering both conventional and sukuk instruments, which will soon be presented to the government.